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Miles J. Zaremski

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Americans "Win" if the Health Care Mandate Is Tossed Out

Posted: 08/14/11 09:50 AM ET

It has been headline news that the 11th Circuit federal appeals court in Atlanta ruled that the mandate in Obama's Affordable Care Act ("ACA") -- Obamacare -- was unconstitutional, while reversing the lower federal court's decision that the entire act should be tossed because without the mandate the entire act cannot stand. The decision, set forth in an exhaustive and very well researched and thought out, 291-page opinion, was decided on August 12 by a 2-1 decision. This follows on the heals of another (recent) federal appeals court (6th Circuit) decision out of Cincinnati that similarly decided by a 2-1 vote, but held the mandate constitutional. Yet to weigh in is the 4th Circuit federal court of appeals in Richmond, Va. that heard arguments not too long ago. Be mindful that there is a procedure in the appeals court where the losing side can ask all the members of the particular court to review the decision (called, en banc). Regardless of whether this occurs, and even if it does, the Supreme Court looks like it will ultimately take the cases due to their importance and the issues involved. Typically, when there is also a split in the federal circuits on issues of considerable importance -- like access and affording health care as provided in ACA -- it is more likely than not that the high Court will want to become involved.

Mainstream media coverage of the 11th circuit opinion, including a headline piece in Huffington Post's main-page section on August 13, has opted to more concentrate on the opinion being a "blow" to Obama and his administration than on what may well be a "win" -- ultimately -- for all Americans.

Obama wanted not to have a mandate, but a public option. He was severely criticized at the time by those (his opposition in Congress) who thought this would increase the federal government's presence in an area that should be left to individuals to decide. (These are the same folks who said to leave health care up to them but never take away their Medicare coverage.) The insurance industries, including the managed care associations and its members that all back this opposition, did not want such an option since it would no doubt provide competition for its products (that it continues to sell to Americans at astronomical costs), i.e., health care insurance policies. Moreover, those entities knew that in order to pay for the new benefits provided in ACA, like being covered for pre-existing conditions, without eating into their profit margin, additional funds would have to be generated. This, then, was the genesis and need for the mandate.

If the Supreme Court takes the three federal appellate court cases and then decides the mandate is unconstitutional without throwing out the entire act, Americans will still have available the new benefits but there will not be the additional funding for the insurance entities to pay for them. And this means less profits for a an already very profitable industry. Of course, given this scenario, insurers will no doubt want to jack up insurance premiums to even higher levels than seen now to cover for the loss of revenues generated by a mandate, but perhaps if this were to ever occur, maybe a public option would then have to come about to keep insurance policy premiums down to an affordable level.

Wouldn't it be the height of irony if the mandate forced upon Obama by the insurance industry to protect its profit margins is tossed out as unconstitutional, but still left with having to pay for the coverages found elsewhere in the act? Who is the victor here? Start with all Americans.